Facing increasing scrutiny from the media and general public over a rash of employee suicides, Apple manufacturing partner Foxconn is rumored to be plotting an exodus from mainland China sometime in the future.

Nevertheless, the report cited Hon Hai chairman Terry Gou as saying his firm was in the midst of planning a restructuring that would uproot its mainland China operations in favor of peppering them throughout other regions in Far Eastern such as Taiwan, Vietnam, and India.

The move could reportedly affect up to 800,000 employees, including those employed at Foxconn's Shenzhen location that builds the vast majority of Apple's mobile devices and some Macs.

Foxconn has come under fire in recent weeks as reports of employee suicides over the past year continue to mount. Just before the 10th suicide last month, when a 19-year-old worker who had been with the company just 42 days jumped from a building to his death, Gou insisted to reporters that his company was not running a "sweatshop."

The matter drew enough attention to warrant a comment from Apple, which said it was "saddened and upset by the recent suicides." The iPhone maker added that it was in direct contact with Foxconn senior management and believed the company was taking this matter very seriously.

For Apple, it's not the first time that events at Foxconn have threatened to sour its squeaky clean image. In 2006, the company began conducting a thorough audit of one of Foxconn's manufacturing plants that created iPods after an in-depth media report suggested that workers at the factory were being treated unfairly and forced to operate under sweatshop-like conditions for little pay.

Apple now issues an annual audit of its overseas manufacturing partners. Last year's review found that more than half weren't paying their workers valid overtime rates. Still, Apple -- and numerous other electronics manufacturers like Dell and HP -- have maintained their business relationships with Foxconn, and the company is believed to be the manufacturer of the next-generation iPhone that will hit the market later this month.

At this week's shareholders meeting, Guo reportedly said he suspects the ongoing suicides may be of the copy-cat variety, fueled by media coverage and the expectation of monetary compensation for the families of the deceased. As such, he said Foxconn has suspended death benefits to deter employees from plunging to their deaths from the rooftops of its factories.

In other efforts to improve employee moral, Foxconn has reportedly instated pay raises for its employees, with media reports putting figures at anywhere between 20 and 33%. Separately, the company is said to also begin offering a 66% performance-based raise incentive, though details on how that would be calculated are scarce.

In addition to Apple's inspectors, the Chinese government recently sent approximately 200 inspectors to Foxconn's facilities, who reportedly exonerated Foxconn management for any wrongdoing in the ongoing string of suicides.

Foxconn manufactures for a lot of people, not JUST Apple, I think the press is forgetting this or just choosing to Drag Apple through the Mud, they make stuff for Dell, and HP as well, not to mention a number of other companies all over the world. It is likely that Apple isn't even their biggest client.

Sounds like the few people that decided to kill themselves are possibly going to affect hundreds of thousands of others, India would be a potential suitor if Foxcon decided to move their operation out of China.

Although the suicide rates seem to be astronomical I wasn't aware that they employed around 800,000 people, so in the grand scheme of things the rate isn't that high.

Statistically these suicides are extremely low, unfortunate though they are.

It seems that once a company or even individuals reach near or achieve the pinnacle of success, they sadly become a media target to be brought down and have their reputations tarnished in some way. Sadly, this is the way of the world, instead of looking on the good things a company does there is a relentless drive to 'dig up dirt' as it were.

It would now appear that media interest in Foxconn will make matters worse for those workers as people will lose their employment. Sad.

Sounds like the few people that decided to kill themselves are possibly going to affect hundreds of thousands of others, India would be a potential suitor if Foxcon decided to move their operation out of China.

Although the suicide rates seem to be astronomical I wasn't aware that they employed around 800,000 people, so in the grand scheme of things the rate isn't that high.

They are bound to have a few bad apples when you are employing almost a million people. These manufacturers are CITIES. I'm surprised they don't have a homicide rate on file as well.

Scaremongers? A rash of loss of human life (no matter the reason) should be taken very seriously and investigated. I doubt they are going to leave china. This is most likely a ploy to gain favorable treatment from the Chinese government. Americans are very naive about this stuff.

It seems to me like they're posturing. The Chinese gov. won't want 400,000 suddenly unemployed people to deal with. Mind you it is China, over 1.3 billion strong - 400k might seem like a drop in the bucket so yeah, that's my first post on AI.

Hey, Apple! How about moving the manufacturing HOME to the UNITED STATES! Gee, ever thought of that? We have people who need JOBS here, morons!

I agree. Maybe China could relocate to some depressed area - like - just name some place - the Midwest, the Gulf Coast, etc... Our manufacturing sector is depressed because of the greed of our large corporations, including a company that I admire - Apple. There are many, many people in our own country that would love to have a factory job, if they were available. In stead, they are working flipping hamburgers or working at Wallmart selling products made in China or India.

I thought China was the bottom of the barrel when it came to sweat shops, but I guess Vietnam and India are even sweatier.

Hey, Apple! How about moving the manufacturing HOME to the UNITED STATES! Gee, ever thought of that? We have people who need JOBS here, morons!

How much more would you pay to bring these jobs to the US before you bought someone elses cheaper, China made product? These places are self fulfilling prophecies.

This is unfortunate but these workers over there could teach America some valuable lessons. Whatever situation and stress these unfortunate workers were going through, likely for a long period of time, I guarantee you they went to work every single day.

I know 3 people alone today here that are taking "Mental health days" because its to stressful with their giant houses, expensive cars and cushy lifestyles.

I agree. Maybe China could relocate to some depressed area - like - just name some place - the Midwest, the Gulf Coast, etc... Our manufacturing sector is depressed because of the greed of our large corporations, including a company that I admire - Apple. There are many, many people in our own country that would love to have a factory job, if they were available. In stead, they are working flipping hamburgers or working at Wallmart selling products made in China or India.

I thought China was the bottom of the barrel when it came to sweat shops, but I guess Vietnam and India are even sweatier.

Whatever your thoughts are on outsourcing and in particular, outsourcing to Asia, you need to do a little research. There are sweatshops everywhere but that doesn't mean to say every company that produces goods for Apple and the like are sweatshops. There are non sweatshops factories in Asia.
Another little point, though I suspect I will be told off for being off topic.... The manufacturing sector is depressed in part because of corporate greed but I wonder if you'd be willing to pay what it costs to produce your luxury goods were they to be produced in the US, and were the workers that produced them paid what you would consider a decent living wage for their work.

Scaremongers? A rash of loss of human life (no matter the reason) should be taken very seriously and investigated. I doubt they are going to leave china. This is most likely a ploy to gain favorable treatment from the Chinese government. Americans are very naive about this stuff.

I agree with you it is a bit of ploy to get some support from government. I strongly suspect that's the audience that this was intended to reach.

How much more would you pay to bring these jobs to the US before you bought someone elses cheaper, China made product? These places are self fulfilling prophecies.

This is unfortunate but these workers over there could teach America some valuable lessons. Whatever situation and stress these unfortunate workers were going through, likely for a long period of time, I guarantee you they went to work every single day.

I know 3 people alone today here that are taking "Mental health days" because its to stressful with their giant houses, expensive cars and cushy lifestyles.

You have to be kidding. Do you have any idea what the American workers in this country are going through. Yes, I would pay considerably more if products were made in this country and there would be a lot more who could afford to make products made in this country if they weren't making minimum wage. What in the world do you think the people are doing now that used to work in our factories? Do you think everyone has become a computer consultant or programmer?

I think jobs leaving this country is one of the biggest factors for the state that our country is in right now. Growing up in the 50's and 60's, I remember how robust this country was and the reputation the U.S. had in the world for being creative and productive. American corporations have given this away - for the sake a money. They've said " to hell with our fellow Americans. I can make more money by putting them on the unemployment rolls and hiring some foreign worker for 50 cents per hour. Our American businesses are killing the goose that used to lay golden eggs.

Sounds like the few people that decided to kill themselves are possibly going to affect hundreds of thousands of others, India would be a potential suitor if Foxcon decided to move their operation out of China.

Although the suicide rates seem to be astronomical I wasn't aware that they employed around 800,000 people, so in the grand scheme of things the rate isn't that high.

Suicide rates at Foxconn are lower than the average for China -- unless SJ was lying in his ATD interview with Mossberg.

Hey, Apple! How about moving the manufacturing HOME to the UNITED STATES! Gee, ever thought of that? We have people who need JOBS here, morons!

Go ahead and be the first in line for products that cost double or triple their current costs. Also let's leave the poorer countries to fend for themselves and not give them an opportunity to build better economies for themselves.

And yeah, there's all kinds of corruption and exploitation happening in these countries, I know. Old news. Time to take off the US-centric blinders and see the world for what it is. My Fortune 50 company has to support operations globally, so I get to see this first hand. Once you get out a bit and actually see what the world is really like - then we can talk.

You have to be kidding. Do you have any idea what the American workers in this country are going through. Yes, I would pay considerably more if products were made in this country and there would be a lot more who could afford to make products made in this country if they weren't making minimum wage. What in the world do you think the people are doing now that used to work in our factories? Do you think everyone has become a computer consultant or programmer?

I think jobs leaving this country is one of the biggest factors for the state that our country is in right now. Growing up in the 50's and 60's, I remember how robust this country was and the reputation the U.S. had in the world for being creative and productive. American corporations have given this away - for the sake a money. They've said " to hell with our fellow Americans. I can make more money by putting them on the unemployment rolls and hiring some foreign worker for 50 cents per hour. Our American businesses are killing the goose that used to lay golden eggs.

I agree, In the 50's and 60's the United States was highly competitive either through innovation or otherwise. So... what happened?

You have to be kidding. Do you have any idea what the American workers in this country are going through. Yes, I would pay considerably more if products were made in this country and there would be a lot more who could afford to make products made in this country if they weren't making minimum wage. What in the world do you think the people are doing now that used to work in our factories? Do you think everyone has become a computer consultant or programmer?

I think jobs leaving this country is one of the biggest factors for the state that our country is in right now. Growing up in the 50's and 60's, I remember how robust this country was and the reputation the U.S. had in the world for being creative and productive. American corporations have given this away - for the sake a money. They've said " to hell with our fellow Americans. I can make more money by putting them on the unemployment rolls and hiring some foreign worker for 50 cents per hour. Our American businesses are killing the goose that used to lay golden eggs.

Sure, American consumers will pay more for their computers to get out of China, more for gas to stop offshore drilling, more for toys from Walmart to bring toy-making back to the US, more for their mortgage interest so that they can whack Goldman Sachs, more for customer service so that they can speak to someone without an Indianized American accent....

You seriously think it's American businesses that are killing the geese? No, it's the geese themselves.

You have to be kidding. Do you have any idea what the American workers in this country are going through. Yes, I would pay considerably more if products were made in this country and there would be a lot more who could afford to make products made in this country if they weren't making minimum wage. What in the world do you think the people are doing now that used to work in our factories? Do you think everyone has become a computer consultant or programmer?

I think jobs leaving this country is one of the biggest factors for the state that our country is in right now. Growing up in the 50's and 60's, I remember how robust this country was and the reputation the U.S. had in the world for being creative and productive. American corporations have given this away - for the sake a money. They've said " to hell with our fellow Americans. I can make more money by putting them on the unemployment rolls and hiring some foreign worker for 50 cents per hour. Our American businesses are killing the goose that used to lay golden eggs.

The golden eggs come from focusing on what you are best at. Businesses that survive understand this. Other businesses (say like GM) fail to recognise the things they're no longer relatively very good at and destroy themselves in the process.

You have to be kidding. Do you have any idea what the American workers in this country are going through. Yes, I would pay considerably more if products were made in this country and there would be a lot more who could afford to make products made in this country if they weren't making minimum wage. What in the world do you think the people are doing now that used to work in our factories? Do you think everyone has become a computer consultant or programmer?

I think jobs leaving this country is one of the biggest factors for the state that our country is in right now. Growing up in the 50's and 60's, I remember how robust this country was and the reputation the U.S. had in the world for being creative and productive. American corporations have given this away - for the sake a money. They've said " to hell with our fellow Americans. I can make more money by putting them on the unemployment rolls and hiring some foreign worker for 50 cents per hour. Our American businesses are killing the goose that used to lay golden eggs.

without the rose-colored glasses: The economy of the United States is the world's largest economy, estimated at $14.2 trillion or roughly three times that of the next one - which is Japan. Gross Domestic Product is nearly twice that China. In 2006, consumer spending made up 70 percent of the United States Gross Domestic Product.

The U.S. economy historically has maintained a stable GDP growth rate, low unemployment rate, and high levels of research and capital investment funded by both national and, because of decreasing saving rates, increasingly by foreign investors.

Since the 1960's, the United States economy absorbed savings from the rest of the world. The phenomenon is subject to discussion among economists. In spite of increasing ranks of retiring baby boomers withdrawing from their Social Security accounts; the American population is young and growing compared to Europe or Japan. The American labor market has attracted immigrants from all over the world and has one of the world's highest migration rates. Americans have the highest income per hour worked.

All this means is that our economy as robust as it is, makes the use of lesser economies more attractive to achieve lower costs for manufactured goods. Conversely however, it also means that with a high standard of living even our poor and unemployed make more than the poor in most other countries. We have a lower incident of death due to illness compared to most of the countries we farm our manufacturing out to and longer overall lifespan as a result of our standard of living.

I agree. Maybe China could relocate to some depressed area - like - just name some place - the Midwest, the Gulf Coast, etc... Our manufacturing sector is depressed because of the greed of our large corporations, including a company that I admire - Apple. There are many, many people in our own country that would love to have a factory job, if they were available. In stead, they are working flipping hamburgers or working at Wallmart selling products made in China or India.

It's not so simple - the manufacturers have to make cheap products because although consumers complain, they still buy the cheapest stuff - not from America. How many of us honestly always look for a Made in Canada/USA tag, and won't buy if it isn't present?

The problem is your fault, and my fault, and actually, if you look at it globally instead of regionally, it's not even a problem...

Hey, Apple! How about moving the manufacturing HOME to the UNITED STATES! Gee, ever thought of that? We have people who need JOBS here, morons!

Will you be the first one to sign up to work 12 - 16 hours a day for $200.00 a month? (I am making up the hours - not sure how many hours they work per day - but the $200 figure was something I heard on CNN as the average monthly wage when they were given a tour of the place.)

Sure, American consumers will pay more for their computers to get out of China, more for gas to stop offshore drilling, more for toys from Walmart to bring toy-making back to the US, more for their mortgage interest so that they can whack Goldman Sachs, more for customer service so that they can speak to someone without an Indianized American accent....

You seriously think it's American businesses that are killing the geese? No, it's the geese themselves.

Well, that's a Big F*** No. This sounds like some corporate plant showing up in the AI blogs.

As far as Indian accents reviewing our credit cards accounts whenever we call? Thats an easy fix. Ship those jobs elsewhere. Like Brazil, Philippines or Malaysia, somewhere where the people do not harbor this manifest seething disrespect and disregard towards Americans in particular and American prosperity in general and where wages are comparable or even lower and attitudes much better.

Does anyone seriously think the Chinese have any leverage in this Foxconn case or even the Honda case?? The mighty globalization gravy train will just simply pick up and move on from the Chinese and Indians who because they think themselves so smart will know how to fill an 800K jobs gap through farming hillocks and water buffalo washes.

My personal preference is for the Taiwanese owners of Foxconn to move these jobs back to Taiwan or Vietnam, Philippines, and as a back up Malaysia/Indonesia. Has anyone ordered from Victoria Secret lately? They out sourced production to Southern India and therefore lingerie arrive in the mail with a nasty curry smell bordering on the unmentionable straight from the bag. The last thing I want is for my iPod or iPhone to smell like that out of the box. At least with VC, one can wash the smell out with Woolite whereas I am afraid Apple is very much against water touching their electronics.

The only thing the Chinese have done with profits from off shoring is to buy new weapons for their military. And the Indians are following in the exact same footsteps even without prodding from their neighbors. Indians also lack modern ports or what we in the west might call roads.

Sure, American consumers will pay more for their computers to get out of China, more for gas to stop offshore drilling, more for toys from Walmart to bring toy-making back to the US, more for their mortgage interest so that they can whack Goldman Sachs, more for customer service so that they can speak to someone without an Indianized American accent....

You seriously think it's American businesses that are killing the geese? No, it's the geese themselves.

Well, that's a Big F*** No. This sounds like some corporate plant showing up in the AI blogs.

As far as Indian accents reviewing our credit cards accounts whenever we call? Thats an easy fix. Ship those jobs elsewhere. Like Brazil, Philippines or Malaysia, somewhere where the people do not harbor this manifest seething disrespect and disregard towards Americans in particular and American prosperity in general and where wages are comparable or even lower and attitudes much better.

Does anyone seriously think the Chinese have any leverage in this Foxconn case or even the Honda case?? The mighty globalization gravy train will just simply pick up and move on from the Chinese and Indians who because they think themselves so smart will know how to fill an 800K jobs gap through farming hillocks and water buffalo washes.

My personal preference is for the Taiwanese owners of Foxconn to move these jobs back to Taiwan or Vietnam, Philippines, and as a back up Malaysia/Indonesia. Has anyone ordered from Victoria Secret lately? They out sourced production to Southern India and therefore lingerie arrive in the mail with a nasty curry smell bordering on the unmentionable straight from the bag. The last thing I want is for my iPod or iPhone to smell like that out of the box. At least with VC, one can wash the smell out with Woolite whereas I am afraid Apple is very much against water touching their electronics.

The only thing the Chinese have done with profits from off shoring is to buy new weapons for their military. And the Indians are following in the exact same footsteps even without prodding from their neighbors. Indians also lack modern ports or what we in the west might call roads.

It's not so simple - the manufacturers have to make cheap products because although consumers complain, they still buy the cheapest stuff - not from America. How many of us honestly always look for a Made in Canada/USA tag, and won't buy if it isn't present?

The problem is your fault, and my fault, and actually, if you look at it globally instead of regionally, it's not even a problem...

I do.

I also pay more for locally grown produce, and go to restaurants who use local organic stuff like meat and milk. Poppy's in Beacon is one of them (Paul will be on chopped on the food network soon I think.)

My wife doesn't like the idea of spending nearly double on groceries though, and clothes made in the US aren't very inexpensive, either. However, I pay the premium. Not many do, though. Why should you, other than to keep businesses in your area? That's really the only reason. If a farm decided to stop selling the milk locally and moved to Vermont, they might as well have moved to India, because I wouldn't be able to stop by and see how they are doing things. They wouldn't be employing my neighbors, and they wouldn't be paying taxes or shopping locally either.

However, with electronics, we don't have much of a choice: buy or abstain. I choose buy.

Sure the suicide rate at Foxconn is lower than the Chinese average. But is the suicide rate lower than industry average for example?

I don't think the outcry is unusual. Walmart's got something like a million employees in the US. If they had this many suicides in so short a timeframe, you can bet the media and government would be all over it. Nobody would be suggesting it's okay just because the suicide rate was lower than average. It's still highly unusual for one employer to have that many suicides, even if the rate is lower than average.

Anyway, maybe taking away the financial incentives will help them curb the suicide rate.

As for moving, India would be a great place for them to move. Though I doubt they'd get away with the same working conditions there. India is a democracy after all. And unions are fairly active there. At the same time though, India does tend to have large numbers of skilled workers available and Apple is one of the few IT companies not to have a significant presence in India. It would make sense to set up shop in what will some day be the largest consumer market in the world.

Foxconn is a contract manufacturer; they get paid based on production volume. If you want to increase volume by 10%, what do you do?

Think of the logistics of hiring, accommodating, feeding, and managing an extra 80,000 people. Think about the logistics of expanding production lines.

Ask yourself how a 10% production increase happens in the US. Do you like the idea of constant cycles of hiring and layoffs?

Now, say you are 20-25% over nominal capacity already. You have peaked what you can accomplish with existing facilities. What now? (Exactly what they are doing: diversifying into other areas.)

diversifying its facilities would not be necessarily ok for foxconn. foxconn is the only the final assembly factory while all components are coming from various parts of china. yes, if foxconn moves some its facilities to india, the over cost on its effort to ship components might not be favorable for foxconn. the same thing will be applicable if foxconn moves back to taiwan. so foxconn gets stuck in mainland china.

Will you be the first one to sign up to work 12 - 16 hours a day for $200.00 a month? (I am making up the hours - not sure how many hours they work per day - but the $200 figure was something I heard on CNN as the average monthly wage when they were given a tour of the place.)

This is justification? Seriously, I have no idea why we let our companies ship manufacturing overseas. What does it serve us? The richest, most powerful countries in the world tend to be those heaviest in manufacturing. It was the US prior to the 1980's, then Japan, now China. The US is living on China's dime, right now. How is this good? It also depletes our standard of living. Companies shop your wages against the cost shipping your job overseas to a sweatshop in a 3rd world country.

Fair trade...not free trade! The US should start tariffs on all goods not produced in countries with a similar wage structure, similar pollution controls, and similar trade practices. That would bring the jobs home.

Hey, Apple! How about moving the manufacturing HOME to the UNITED STATES! Gee, ever thought of that? We have people who need JOBS here, morons!

Those low cost manufacturing jobs will never return to the United States. They will bounce around Asia until wages get too high there, then move to Africa. Then eventually fully automated factories will be developed, and no-one will have those jobs.

The solution to the current unemployment problems is for completely new companies, in new areas, to open. But trying something new is a risk, you can potentially lose all your investment. People will only try it if there is the possibility of making a big profit. And that requires business friendly government policy.

Fair trade...not free trade! The US should start tariffs on all goods not produced in countries with a similar wage structure, similar pollution controls, and similar trade practices. That would bring the jobs home.